Although transforming growth factor beta (TGF-beta) was first identified based on its effect on the growth and differentiation of cultured cells, recent work has shown that members of this family of growth and differentiation factors play important roles in the specification of embryonic pattern in a large variety of organisms, including mice, Xenopus, chicken, and Drosophila. However, very little is known about the mechanisms used to regulate the activities of these proteins in vivo. In Drosophila, the TGF-beta family member decapentaplegic (dpp) acts as a morphogen to organize dorsalventral pattern within the ectoderm of the embyro; two-to four-fold increases in dpp activity are sufficient to specify progressively more dorsal cell fates. In vivo, the dpp gene is uniformly transcribed over the region in which it is expressed; thus a gradient of dpp activity must be established at a post-transcriptional level. Genetic studies indicate five genes differentially regulate dpp activity post-transcriptionally over the dorsal-ventral axis. The products of the tolloid, shrew, screw, and twisted gastrulation genes elevate dpp activity on the dorsal side of the embryo, while the product of the short gastrulation (sog) gene blocks dpp activity on the ventral side of the embryo. This proposal describes a series of experiments to determine how the products of these genes interact to establish a gradient of dpp activity during early embryogenesis. Because the proteins that regulate dpp activity are likely to be similar to the proteins that regulate the activities of other TGF-beta family members in vertebrates, these experiments could provide information about how the activities of TGF-beta family members are regulated to organize the fates of fields of cells during vertebrate development. Wild-type embryos respond asymmetrically to localized injection of dpp transcripts. Because this asymmetric response is likely to mirror the in vivo mechanisms used in the formation of the dpp gradient, the first specific aim is to use a variety of genetic, developmental, and biochemical manipulations to understand the mechanistic basis for the asymmetric response to dpp transcript injection. The second and third aims of this proposal are to undertake a molecular analysis of the sog and shrew genes. The sog gene will be cloned by using a preexisting transposon-induced allele of the gene as a tag to isolate genomic DNA encompassing the locus. The shrew gene will be cloned by undertaking a chromosomal walk from nearby cloned DNA. The DNA encoding these genes will be used to predict the protein product of each gene, to investigate the pattern of transcription of each gene in wild-type and mutant backgrounds, to make antibodies to the protein of each gene in order to assay subcellular localization. The fourth specific aim is to ascertain whether the dpp gradient represents a gradient of dpp protein or a gradient of an active form of the dpp protein. The technique of epitope tagging will be used to visualize the distribution of dpp protein in frozen sections of blastoderm embryos. The use of this technique will be expanded to explore the biochemical interactions that could be involved in the formation of the dpp gradient.